9 - RDA SectionMay 12, 2011 PROPOSED
F - 1
TOWN of LOS GATOS
REDEVELOPMENT AGENCY
he Los Gatos Town Council activated the Los Gatos Redevelopment Agency on January 22,
1990, pursuant to the provisions of the California Community Redevelopment Law (Health and
Safety Code, Section 33000 et seq.) and declared itself to constitute the Agency, by Ordinance
No. 1806, adopted on December 4, 1989. The Redevelopment Plan was pursued as a result of the
Loma Prieta Earthquake in 1989 and the need to rebuild existing infrastructure. The Redevelopment
Agency area encompasses approximately 440 acres in and around Downtown Los Gatos, which includes
retail and residential areas, lodging, schools, and main traffic thoroughfares. Projects such as street and
utility reconstruction, parking, streetscape, and civic improvements were called out in the plan.
BUDGET OVERVIEW
The Agency receives the majority of its funds from tax increment revenues. When the Agency was
formed in 1991, the tax base for all properties within the Central Los Gatos Redevelopment Area was
“frozen” to form the base year. As properties are reassessed due to sales or improvements over the
Agency’s 40-year life span, the tax base grows and the Agency receives the majority of the difference in
property taxes paid between the “base year” and the new level. This is called “tax increment financing”
and is the primary funding mechanism for redevelopment agencies throughout California. This does not
result in an increase in taxes to property owners, but rather a redistribution of property taxes to the
redevelopment agency to allow for reinvestment within the redevelopment project area. The Agency will
terminate at the end of its 40-year life span – in the year 2031.
Since the Redevelopment Plan was adopted, a number of actions and changes have occurred which
facilitated implementation of the Agency Plan. First is that the Agency’s tax increment revenue grew
significantly in recent years to a level where the Agency could finance key projects. As shown in the
RDA Debt Administration Fund’s Source and Use of Funds Statement, total Agency gross tax increment
is estimated to grow to approximately $8.8 million in FY 2011/12.
T
May 12, 2011 PROPOSED
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LOS GATOS REDEVELOPMENT AGENCY
Educational Revenue Augmentation Fund (ERAF) / Supplemental Educational Revenue
Augmentation Fund (SERAF)
Since the early 90’s, the State of California has taken property tax increment revenues from
redevelopment agencies to balance its budget under the description of the “Educational Revenue
Augmentation Fund” (ERAF) and “Supplemental Educational Revenue Augmentation Fund” (SERAF).
In response to the State’s actions, several lawsuits were filed by the California Redevelopment
Association (CRA) and some are still pending. In 2004, Proposition 1A, which was designed to protect
local revenue sources, was passed by the voters but unfortunately did not specifically protect RDA tax
increment, leaving cities vulnerable. However, in 2011, the League of California Cities and the CRA led
a successful coalition to develop an initiative, entitled the “Local Taxpayer, Public Safety, and
Transportation Protection Act of 2010,” also known as Proposition 22. Legal experts believe that this
proposition would provide enhanced protection, minimizing the potential for state raids.
State Budget Proposal to Eliminate Redevelopment Agencies (RDA)
As part of the FY 2011/12 state budget, the Governor has recommended the elimination of redevelopment
agencies in California. The CRA has developed a comprehensive legal, legislative, public affairs, and
lobbying plan to defeat this proposal. Given the seriousness of the State’s proposal, the Town has taken
steps to secure its RDA funding for future projects and set aside approximately $800,000 for RDA
administrative overhead, which is also at risk.
Fiscal Year 2011/12 Revenues and Expenditures
Redevelopment property tax increment revenue for FY 2011/12 is estimated to be $8.8 million. The
following provides a summary of the Agency’s planned expenditures for capital projects, debt service,
and required affordable housing. Budgeted expenditures for Fiscal Year 2011/12 will include:
• Pass through payments to taxing entities: When the Agency was created in 1991 tax-sharing
agreements were negotiated with affected educational entities, the Open Space District, and Santa
Clara County. These payments, based on the amount of tax increment the Agency receives, go to
these entities to relieve them of any financial burden that the Redevelopment Plan may cause them.
Nearly half of all Agency tax increment will be passed through to these taxing entities. Such pass-
throughs help support educational activities at Los Gatos High School and the Los Gatos Union
Elementary School District, and are reflected in the Debt Administration Fund. Pass through
payments for FY 2011/12 are estimated to be $3,777,313.
• 1992 COP payments for Parking Lot #4: The Town issued debt for approximately $2.5 million in
1992 to finance the construction of the downtown parking garage known as Lot #4. Redevelopment
Agency tax increment is used to pay the debt service on the COPs in an amount of approximately
$250,000 annually. The debt will be paid off in FY 2011/12.
• 2002 COP payments for RDA Capital Projects: In 2002, the Town issued debt for approximately
$10.8 million to fund RDA infrastructure projects in the project area. Annual debt service payments
of approximately $680,000 will continue through FY 2031/32.
• 2010 COP payments for Town Library: In 2010, the Town issued debt for approximately $15.7
million to fund the construction of the new Library building. Annual debt service payments of
approximately $1.2 million will continue through FY 2027/28.
• Agency administration: This pays for the day-to-day operations of the Agency, including staff salary
and benefits, supplies and materials, and consultant assistance. Budgeted expenditures are estimated
to be $715,952.
May 12, 2011 PROPOSED
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LOS GATOS REDEVELOPMENT AGENCY
• Overhead charges paid to the Town of Los Gatos: The Agency is a separate legal entity from the
Town; however, it utilizes direct services from the Town. This expenditure reimburses the Town for
such items as office space, utilities, financial and administrative support functions, and most
significantly, the staff time that various members of the Town staff devote to redevelopment
activities. The Agency will pay $658,730 to the Town in overhead expenses.
• Redevelopment Projects and Affordable Housing Projects: These are the funds spent directly, or
indirectly, on projects to implement the Redevelopment Plan. In FY 2009/10, the Agency purchased
two properties to be used for low and moderate housing. The first property is located at 224 West
Main Street and will be developed within the next five years. The second property is 20 Dittos Lane
and is now in the development process to construct up to 32 low and moderate apartments and
approximately 57 parking spaces on the 1.58 acre site.
• Economic Vitality Program: This program implements the adopted Economic Vitality Plan, which
provides for business retention, expansion, attraction, and revenue enhancement programs for the
Town. The program is partially paid for as part of the Agency administration and Low/Moderate
Housing budgets.
The Los Gatos Redevelopment Agency’s budget implements an aggressive work program to complete
key redevelopment projects in the downtown area, implement affordable housing projects using 20
percent set-aside funds, and for the Economic Vitality Program of the Town. Planned FY 2011/12
Capital Project carryover expenditures are described further in the Capital Projects Fund section.
May 12, 2011 PROPOSED
F – 4
LOS GATOS REDEVELOPMENT AGENCY
Full Time Equivalent (FTE)
Authorized2007/082008/092009/102010/112011/12
Town Staff
PositionsFundedFundedFundedFundedFunded
Community Development Dir.0.20 0.10 0.20 0.20 0.20 0.20
Asst. Community Dev. Dir.- 0.35 0.20 0.20 - -
Planning Manager0.10 - - - 0.10 0.10
Economic Vitality Manager0.80 0.80 0.80 0.80 0.80 0.80
Administrative Analyst0.20 0.20 0.20 0.20 0.20 0.20
Senior Planner0.25 - - - 0.25 0.25
Associate Planner- 0.20 0.40 0.20 - -
Community Services Director- 0.05 0.05 0.05 - -
Total RDA FTEs1.55 1.70 1.85 1.65 1.55 1.55
REDEVELOPMENT AGENCY PROGRAM STAFFING
May 12, 2011 PROPOSED
F - 5
TOWN of LOS GATOS
REDEVELOPMENT AGENCY
Capital Projects Fund
FUND 911
FUND PURPOSE
The Redevelopment Agency’s Capital Projects Fund encompasses three core functions: Redevelopment
Agency (RDA) administration, capital project development and implementation, and the implementation
of the Economic Vitality Program. Administrative functions include all fiscal and reporting matters of the
Agency in conjunction with the Finance Department. The second function, capital project development,
includes the planning and support of proposed redevelopment projects, and the implementation of the
goals and policies of the Los Gatos Redevelopment Plan. Construction project oversight is administered
by the Parks and Public Works Department. The purpose of the third function, the Economic Vitality
Program, is to increase revenues through business promotion and development. Its core services include
business retention, development, expansion and attraction, business appreciation and recognition, and tax
monitoring.
BUDGET OVERVIEW
The Capital Projects Program budget includes administrative revenues and expenditure activity in
addition to capital project activity. The Agency also funds year-round Town marketing activities in
support of the downtown business community.
Capital projects currently in process are funded through the 2002 Certificates of Participation (COPs)
issuance, as designated in the plan for key infrastructure improvements in the Downtown. The remaining
funding for the Santa Cruz Avenue/Wood Road Gateway design project was reassigned to the Pageant
Grounds Access Improvement Design project. The Pageant Grounds Access Improvement Design project
was completed in FY 2010/11. Capital improvements are now focused on the Almond Grove Street
Rehabilitation project design.
May 12, 2011 PROPOSED
F – 6
LOS GATOS REDEVELOPMENT AGENCY
Capital Projects Fund
2007/082008/092009/102010/112010/112011/12
ActualsActualsActualsAdoptedEstimatedAdopted
SOURCE OF FUNDS
Beginning Fund Balance
Designated- - - - - -
Undesignated4,316,920 2,997,774 2,065,624 1,409,013 1,409,013 1,255,934
Total Beginning Fund Balance
4,316,920 2,997,774 2,065,624 1,409,013 1,409,013 1,255,934
Revenues
Interest Income138,569 66,908 5,952 25,000 11,000 10,000
Total Revenues
138,569 66,908 5,952 25,000 11,000 10,000
Operating Transfers
Transfers - RDA Debt Service550,000 575,000 575,000 600,000 600,000 650,000
Total Operating Transfers
550,000 575,000 575,000 600,000 600,000 650,000
TOTAL SOURCE OF FUNDS5,005,489$ 3,639,682$ 2,646,576$ 2,034,013$ 2,020,013$ 1,915,934$
USE OF FUNDS
Expenditures
Salaries and Benefits164,050 128,279 178,991 174,282 173,836 182,089
Operating Expenditures428,549 485,531 453,187 519,340 483,976 523,230
Capital Projects - Carryfwd38,280
Capital Projects - Current Yr1,403,903 951,833 594,635 134,117 95,837 -
Internal Service Charges11,213 8,415 10,750 10,503 10,430 10,633
Total Expenditures
2,007,715 1,574,058 1,237,563 838,242 764,079 754,232
Ending Fund Balance
Undesignated2,997,774 2,065,624 1,409,013 1,195,771 1,255,934 1,161,702
Total Ending Fund Balance
2,997,774 2,065,624 1,409,013 1,195,771 1,255,934 1,161,702
TOTAL USE OF FUNDS5,005,489$ 3,639,682$ 2,646,576$ 2,034,013$ 2,020,013$ 1,915,934$
STATEMENT OF SOURCE AND USE OF FUNDS
May 12, 2011 PROPOSED
F - 7
LOS GATOS REDEVELOPMENT AGENCY
Capital Projects Fund
Estimated
Expenditures ExpendituresNew
Prior To During EstimatedFunding Total
FY 2010/11FY 2010/11CarryforwardFY 2011/12Budgeted
Completed or withdrawn Projects
1201Pageant Park Access Improvements89,633 56,037 - - 145,670
Total of Completed Projects89,633 56,037 - - 145,670
Carryforward Projects
0003Almond Grove Concrete Rehabiltation1,920 39,800 38,280 - 80,000
Total of Carryforward Projects1,920 39,800 38,280 - 80,000
FY 2011/12
RDA CAPITAL PROJECTS
KEY PROGRAM SERVICES
Redevelopment Agency Capital Projects
• Implement capital project work as identified in the Los Gatos Redevelopment Plan and Five-Year
Implementation Plan
• Facilitate the development of redevelopment projects
Economic Vitality Activities
• Act as a liaison between the business community and Town government
• Provide business outreach and retention efforts
• Provide business recognition activities
• Provide targeted business attraction
Full Time Equivalent (FTE)
Authorized2007/082008/092009/102010/112011/12
Town Staff
PositionsFundedFundedFundedFundedFunded
Community Development Dir.0.10 - 0.10 0.10 0.10 0.10
Asst. Community Dev. Dir.- 0.15 0.05 0.05 - -
Economic Vitality Manager0.75 0.75 0.75 0.75 0.75 0.75
Administrative Analyst0.20 0.20 0.20 0.20 0.20 0.20
Senior Planner0.10 0.10 0.10
Associate Planner- 0.10 0.15 0.10 - -
Asst PPW Dir/Town Engineer- - - - - -
Associate Civil Engineer- - - - - -
Sr Engineering Inspector- - - - - -
Total Capital Projects FTEs1.15 1.20 1.25 1.20 1.15 1.15
CAPITAL PROJECTS PROGRAM STAFFING
May 12, 2011 PROPOSED
F – 8
LOS GATOS REDEVELOPMENT AGENCY
Capital Projects Fund
Performance Objectives and Measures
2007/08
Actual
2008/09
Actual
2009/10
Actual
2010/11
Estimated
2011/12
Budget
1.
a.Percentage of businesses satisfied with the results of
downtown public works projects including:
Streetscape, repaving, merchant notification and
scheduling:
93%95%93%90%90%
2.
a.Percentage of businesses rating business assistance
provided by RDA as good or excellent:89%95%95%98%90%
Activity and Workload Highlights
2007/08
Actual
2008/09
Actual
2009/10
Actual
2010/11
Estimated
2011/12
Budget
1.580590590600540
2.150160160200180
3.220240240300350
4.175185185200250
5.
Data Not
Available
Data Not
Available
Under
Development 42
6 Aa3Aa3Aa2Aa2Aa2Agency Rating (Moody's April 27, 2010)
Business attraction assistance/Number of businesses
assisted
Commercial Brokers/Property Owner Outreach Meetings:
Annual Community Marketing Campaigns: Summer ,
Winter/Holiday , Shop Local - Year-Round, and Tourism
Development
Number of businesses attending business outreach
receptions:
Number of businesses provided with promotion
assistance:
Informs Redevelopment area businesses of proposed
projects and works with businesses to mitigate
concerns.
The RDA Economic Vitality Program ensures efforts are
being made for business attraction, retention and
promotion.
May 12, 2011 PROPOSED
F - 9
TOWN of LOS GATOS
REDEVELOPMENT AGENCY
Debt Administration Fund
Fund 921
FUND PURPOSE
Under California Redevelopment law, tax increment is restricted to the repayment of debt; therefore, a
redevelopment agency must have indebtedness in order to receive tax increment revenues. In response to
this requirement, the Los Gatos Redevelopment Agency incurred debt for use in implementing its
redevelopment plan and to receive tax increment revenue. This indebtedness was achieved by two
primary means: 1) loans from the Town of Los Gatos, and; 2) the issuance of Certificates of Participation.
Debt service payments for this indebtedness are made from the Debt Administration Fund.
BUDGET OVERVIEW
In adherence with Redevelopment law, the Los Gatos Redevelopment Agency incurs debt in two ways.
First, it obtains loans from the Town of Los Gatos, and second, the Agency has undertaken the obligation
of paying debt service on the Town’s 1992 and 2002 Certificates of Participation (COPs) in return for the
lease of Town property. All debts are repaid with tax increment revenue.
1992 Certificates of Participation
The Town of Los Gatos bears the obligation for the 20-year Certificates of Participation issued in the
original amount of $2,960,000, dated August 1, 1992. The Town’s Motor Vehicle License Fee revenues
were pledged as security for the COPs, and the guarantee was registered with the State Controllers Office.
The COPs were issued to finance certain construction costs of the Town’s Parking Lot 4 Project, which
was constructed on land located in the Los Gatos Central Redevelopment Project Area. The project
consisted of the construction of a parking facility comprising of 316 parking spaces on two levels, located
on approximately 4 acres of land in the block bounded by University and Santa Cruz Avenues, and Grays
Lane and Elm Street. The lot improvements were paid for from the 1992 Certificate of Participation
proceeds, in conjunction with the portion paid for through the 1988 Downtown Parking Assessment
District’s Limited Obligation Bonds in the amount of $1,587,986.
The COPs are similar to bond debt as they allow investors to participate in a share of guaranteed
payments. Because they are similar to debt, the present value of the total of the payments to be made is
recorded as long-term debt. Principal payments are due annually on August 1, with interest payments
payable semi-annually on February 1 and August 1.
May 12, 2011 PROPOSED
F – 10
LOS GATOS REDEVELOPMENT AGENCY
Debt Administration Fund
The financing structure of the COPs includes two twenty-year term lease agreements dated August 1,
1992, between the Town of Los Gatos and the Los Gatos Redevelopment Agency. The first lease, with
the Town as lessor and the Redevelopment Agency as lessee, agrees to lease the site to the Agency for the
duration of the lease term for a one-time fee of $10. The second lease, with the Town as lessee and the
Redevelopment Agency as lessor, agrees to lease the completed parking lot site to the Town effective the
date of the lease. Annual lease payments are equal to the annual debt service for the COPs. In addition, a
Reimbursement Agreement dated August 1, 1992, between the Town and Agency, obligates the Agency
to reimburse the Town in an amount equal to the annual lease payment the Town pays to the Agency for
lease of the parking lot (under the second lease agreement). This reimbursement is in consideration of the
Town’s cost of the acquisition and the Town’s funding of the construction of the parking lot project.
While the annual impact of these agreements nets to zero, the lease and reimbursement payments are
included in the Town’s and Redevelopment Agency’s budgets each year to accurately reflect the terms of
these agreements. The Agency remains responsible for making the principal and interest payments to US
Bank.
2002 Certificates of Participation
The 2002 Certificates of Participation financing structure parallels the 1992 issue. The Town of Los
Gatos bears an obligation for the 30-year Certificates of Participation issued in the original amount of
$10,725,000, dated August 1, 2002. The COPs were issued to finance infrastructure improvements in the
downtown redevelopment area including plaza reconstruction, streetscape improvements, street
reconstruction, storm drainage, and alley improvements, as well as partially funding the reconstruction of
the pool at Los Gatos High School. The COPs principal payments are due annually on August 1, with
interest payments payable semi-annually on February 1 and August 1.
The financing structure of the COPs includes two lease agreements between the Town of Los Gatos and
the Los Gatos Redevelopment Agency under agreements dated July 1, 2002. The first agreement leases
five Town-owned parcels, commonly known as the Miles Avenue Corporation Yard, to the
Redevelopment Agency through August 1, 2031 for a one-time fee of $1. In the second lease, the
Redevelopment Agency subleases the land back to the Town, effective the date of the original lease. The
annual sub-lease payments are equal to the annual debt service for the COPs.
A reimbursement agreement between the Town and Agency, also dated July 1, 2002, obligates the
Agency to reimburse the Town in an amount equal to the annual lease payment the Town pays to the
Agency for the sub-lease of the Service Center. This reimbursement is in consideration of the Town’s
cost of the acquisition and construction of the yard facilities.
While the annual impact of these agreements nets to zero, the lease and reimbursement payments are
included in the Town’s and Redevelopment Agency’s budgets each year to accurately reflect the terms of
these agreements. The Agency remains responsible for making the principal and interest payments.
2010 Certificates of Participation
The 2010 Certificates of Participation financing structure parallels the 1992 and 2002 issue. The Town of
Los Gatos bears an obligation for the 18-year Certificates of Participation issued in the original amount of
$15,675,000, dated June 1, 2010. The COPs are being issued to finance the construction of the new Town
May 12, 2011 PROPOSED
F - 11
LOS GATOS REDEVELOPMENT AGENCY
Debt Administration Fund
Library. The COPs principal payments are due annually on August 1, with interest payments payable
semi-annually on February 1 and August 1.
The financing structure of the COPs includes two lease agreements between the Town of Los Gatos and
the Los Gatos Redevelopment Agency under agreements dated June 1, 2010. The first agreement leases
Town-owned parcels, including the existing Library, Police Administration building, and related property
located at the Civic Center, to the Redevelopment Agency through August 1, 2028 for a one-time fee of
$1. In the second lease, the Redevelopment Agency subleases the property back to the Town, effective
the date of the original lease. The annual sub-lease payments are equal to the annual debt service for the
COPs.
A reimbursement agreement between the Town and Agency, also dated June 1, 2010, obligates the
Agency to reimburse the Town in an amount equal to the annual lease payment the Town pays to the
Agency for the sub-lease of the existing library, Police Administration building and related properties.
This reimbursement is in consideration of the Town’s cost of the acquisition and construction of the
library and police facilities.
While the annual impact of these agreements nets to zero, the lease and reimbursement payments are
included in the Town’s and Redevelopment Agency’s budgets each year to accurately reflect the terms of
these agreements. The Agency remains responsible for making the principal and interest payments.
Pass-Through Agreements
Pass-through-agreement payments to taxing entities comprise the majority of the Debt Administration’s
operating expenditures. These payments are based on the amount of tax increment the Agency receives,
with nearly half of all Agency tax increment passed through to these taxing entities.
FY 2011/12 KEY PROJECT
Core Values Key Projects
Quality Public
Infrastructure
Maintain the
condition and
availability of
public facilities,
transportation
systems, and other
public
infrastructure
Library Facility Project
Continue to manage the debt service payment in the amount of $1.2 million as
required under the Certificates of Participation (COPs) agreement to fund the
construction of the new Library.
May 12, 2011 PROPOSED
F – 12
LOS GATOS REDEVELOPMENT AGENCY
Debt Administration Fund
2007/082008/092009/102010/112010/112011/12
ActualsActualsActualsAdoptedEstimatedAdopted
SOURCE OF FUNDS
Beginning Fund Balance
Designated1,500,000 - - - - -
Undesignated2,807,054 6,291,675 7,988,113 7,419,221 7,419,221 7,684,945
Total Beginning Fund Balance
4,307,054 6,291,675 7,988,113 7,419,221 7,419,221 7,684,945
Revenues
Property Tax6,457,740 6,859,401 7,218,289 6,423,550 6,423,550 6,564,128
Lease Income - COPs930,717 929,239 931,371 2,213,470 1,355,236 2,094,727
Interest Income446,432 356,783 163,530 185,000 186,700 151,200
Other Sources- - - - - -
Total Revenues
7,834,889 8,145,423 8,313,190 8,822,020 7,965,486 8,810,055
Operating Transfers
Transfer from General Fund- - - - - -
Transfer-RDA Debt Service - - - - - -
Transfer-Low/Mod Housing- - - - - -
Transfer-Capital Projects- - - - - -
- - - - - -
Total Operating Transfers
- - - - - -
TOTAL SOURCE OF FUNDS12,141,943$ 14,437,098$ 16,301,303$ 16,241,241$ 15,384,707$ 16,495,000$
USE OF FUNDS
Expenditures
Operating Expenditures3,288,828 3,865,504 6,294,340 4,235,930 4,239,290 3,860,083
Debt - Interest Town Loan150,000 150,000 150,000 150,000 150,000 150,000
Debt Service - 1992 COPs 249,188 249,479 249,271 253,500 253,500 252,000
Debt Service - 2002 COPs 681,535 679,763 682,100 678,575 678,575 679,276
Debt Service - 2010 COPs- - - 1,281,000 423,161 1,163,450
1992 Lease Payment to Town249,187 249,479 249,271 253,500 253,500 252,000
2002 Lease Payment to Town681,530 679,760 682,100 678,575 678,575 679,276
2010 Lease Payment to Town- - - 1,281,400 423,161 1,163,451
Total Expenditures
5,300,268 5,873,985 8,307,082 8,812,480 7,099,762 8,199,536
Operating Transfers
Transfer to Capital Projects550,000 575,000 575,000 600,000 600,000 650,000
Total Operating Transfers
550,000 575,000 575,000 600,000 600,000 650,000
Ending Fund Balance
Designated- - - - - -
Loan from General Fund1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000
Undesignated4,791,675 6,488,113 5,919,221 5,328,761 6,184,945 6,145,464
Total Ending Fund Balance
6,291,675 7,988,113 7,419,221 6,828,761 7,684,945 7,645,464
TOTAL USE OF FUNDS12,141,943$ 14,437,098$ 16,301,303$ 16,241,241$ 15,384,707$ 16,495,000$
STATEMENT OF SOURCE AND USE OF FUNDS
May 12, 2011 PROPOSED
F - 13
LOS GATOS REDEVELOPMENT AGENCY
Debt Administration Fund
The maturity schedule for the Redevelopment Agency’s current Debt Service obligation under the 1992
COPs is as follows:
PrincipalTotal
FiscalMaturingAnnual Total Principal
YearAugust 1st Interest DueDebt ServiceBalance
1991/922,960,000
1992/9370,000 184,136 254,136 2,890,000
1993/9475,000 177,836 252,836 2,815,000
1994/9580,000 171,086 251,086 2,735,000
1995/9690,000 163,886 253,886 2,645,000
1996/9795,000 155,786 250,786 2,550,000
1997/98105,000 147,236 252,236 2,445,000
1998/99115,000 137,786 252,786 2,330,000
1999/00125,000 127,436 252,436 2,205,000
2000/01135,000 116,186 251,186 2,070,000
2001/02145,000 107,580 252,580 1,925,000
2002/03150,000 99,895 249,895 1,775,000
2003/04160,000 91,795 251,795 1,615,000
2004/05170,000 82,995 252,995 1,445,000
2005/06175,000 73,475 248,475 1,270,000
2006/07185,000 63,500 248,500 1,085,000
2007/08195,000 54,250 249,250 890,000
2008/09205,000 44,500 249,500 685,000
2009/10215,000 34,250 249,250 470,000
2010/11230,000 23,500 253,500 240,000
2011/12240,000 12,000 252,000 -
TOTAL2,960,000 2,069,116 5,029,116
REDEVELOPMENT AGENCY
1992 COP DEBT SERVICE
May 12, 2011 PROPOSED
F – 14
LOS GATOS REDEVELOPMENT AGENCY
Debt Administration Fund
The maturity schedule for the Redevelopment Agency’s current Debt Service obligation under the 2002
COPs is as follows:
PrincipalInterestInterest
Fiscal MaturingDueDueTotal Principal
YearAugust 1st August 1stFeburary 1stDebt ServiceBalance
Issue Date: August 1, 200210,725,000$
2002/03- - 237,164$ 237,164$ 10,725,000
2003/04210,000$ 235,854$ 233,229 679,083 10,515,000
2004/05215,000 233,229 230,541 678,770 10,300,000
2005/06225,000 230,541 227,729 683,270 10,075,000
2006/07230,000 227,729 224,854 682,583 9,845,000
2007/08235,000 224,854 221,681 681,535 9,610,000
2008/09240,000 221,681 218,081 679,763 9,370,000
2009/10250,000 218,081 214,019 682,100 9,120,000
2010/11255,000 214,019 209,556 678,575 8,865,000
2011/12265,000 209,556 204,720 679,276 8,600,000
2012/13275,000 204,720 199,426 679,146 8,325,000
2013/14285,000 199,426 193,726 678,153 8,040,000
2014/15295,000 193,726 187,679 676,405 7,745,000
2015/16310,000 187,679 181,169 678,848 7,435,000
2016/17320,000 181,169 174,209 675,378 7,115,000
2017/18335,000 174,209 166,755 675,964 6,780,000
2018/19350,000 166,755 158,793 675,548 6,430,000
2019/20365,000 158,793 150,306 674,099 6,065,000
2020/21385,000 150,306 141,163 676,469 5,680,000
2021/22400,000 141,163 131,463 672,625 5,280,000
2022/23420,000 131,463 121,225 672,688 4,860,000
2023/24440,000 121,225 110,500 671,725 4,420,000
2024/25465,000 110,500 98,875 674,375 3,955,000
2025/26485,000 98,875 86,750 670,625 3,470,000
2026/27510,000 86,750 74,000 670,750 2,960,000
2027/28535,000 74,000 60,625 669,625 2,425,000
2028/29565,000 60,625 46,500 672,125 1,860,000
2029/30590,000 46,500 31,750 668,250 1,270,000
2030/31620,000 31,750 16,250 668,000 650,000
2031/32650,000 16,250 - 666,250 -
TOTALS:10,725,000$ +4,551,426$ +4,552,737$ =19,829,163$
LOS GATOS REDEVELOPMENT AGENCY
2002 COP DEBT SERVICE
May 12, 2011 PROPOSED
F - 15
LOS GATOS REDEVELOPMENT AGENCY
Debt Administration Fund
The maturity schedule for the Redevelopment Agency’s current Debt Service obligation under the 2010
COPs is as follows:
InterestPrincipalInterest
Fiscal DueMaturingDueTotal Principal
YearAugust 1stAugust 1st February 1stDebt ServiceBalance
Issue Date: June 1, 201015,675,000$
2010/11423,161 423,161 15,675,000
2011/12320,038 530,000 313,413 1,163,450 15,145,000
2012/13313,413 650,000 300,413 1,263,825 14,495,000
2013/14300,413 670,000 287,013 1,257,425 13,825,000
2014/15287,013 695,000 269,638 1,251,650 13,130,000
2015/16269,638 715,000 258,913 1,243,550 12,415,000
2016/17258,913 745,000 244,013 1,247,925 11,670,000
2017/18244,013 770,000 224,763 1,238,775 10,900,000
2018/19224,763 800,000 208,763 1,233,525 10,100,000
2019/20208,763 830,000 192,163 1,230,925 9,270,000
2020/21192,163 865,000 174,863 1,232,025 8,405,000
2021/22174,863 900,000 152,363 1,227,225 7,505,000
2022/23152,363 935,000 133,663 1,221,025 6,570,000
2023/24133,663 975,000 114,163 1,222,825 5,595,000
2024/25114,163 1,020,000 93,763 1,227,925 4,575,000
2025/2693,763 1,065,000 72,463 1,231,225 3,510,000
2026/2772,463 1,115,000 50,163 1,237,625 2,395,000
2027/2850,163 1,170,000 26,031 1,246,194 1,225,000
2028/2926,031 1,225,000 1,251,031 -
TOTALS:3,436,594$ +15,675,000$ +3,539,717$ =22,651,311$
LOS GATOS REDEVELOPMENT AGENCY
2010 COP DEBT SERVICE
May 12, 2011 PROPOSED
F – 16
LOS GATOS REDEVELOPMENT AGENCY
Debt Administration Fund
California Government Code Section 43605 states: “A city shall not incur an indebtedness for public
improvements which exceeds in the aggregate 15 percent of the assessed value of all real and personal
property of the city. Within the meaning of this section indebtedness means bonded indebtedness of the
city payable from the proceeds of taxes levied upon taxable property in the city.”
This schedule calculates the Town’s legal debt margin by determining the 15% debt limit and comparing
this limit to the Town’s outstanding debt at the end of the fiscal year to determine the difference between
the two. Only certain types of outstanding debt are subject to the legal debt limit; therefore, while this
schedule recognizes all debt, the total debt is reduced by that debt not subject to the legal debt limit, as
well as amounts held in sinking funds for debt repayment.
The Town’s debt structure currently includes only Certificates of Participation which are not subject to
the legal debt limit, and are therefore backed out in the calculation.
Assessed Secured Property Valuation for FY 2010/117,966,902,652$
Debt Limitation (15% of assessed value)15%
Bonded Debt Limit1,195,035,398$
Outstanding Bonded Debt at 6/30/10
1992 Certificates of Participation470,000$
2002 Certificates of Participation9,120,000
2010 Certificates of Participation15,675,000
TOTAL Outstanding Debt25,265,000$
LESS Debt not subject to limit:
Special Assessment Bonds-
Special Revenue Bonds-
Certificate of Participation Debt25,265,000
Amounts held in Sinking Funds-
TOTAL Debt not subject to limit: 25,265,000$
Amount of Debt Subject to Limit: -$ -$
LEGAL DEBT MARGIN1,195,035,398$
LEGAL DEBT MARGIN COMPUTATION
FY 2011/12
May 12, 2011 PROPOSED
F - 17
TOWN of LOS GATOS
REDEVELOPMENT AGENCY
Affordable Housing Fund
FUND 931
FUND PURPOSE
This fund provides for the implementation of the Agency’s required Affordable Housing Set-Aside
Program obligations. The program’s core services include the administration and fiscal responsibilities
for the program, and the creation of affordable housing options in cooperation with non-profit and for-
profit developers.
California Community Redevelopment Law (CRL) requires that no less than 20 percent of tax increment
revenue derived from a redevelopment project area be used to increase, improve, and preserve the supply
of housing for very low, low, and moderate income households. If none is provided within a
redevelopment project area, then the funds can be used to build twice that amount elsewhere. Possibilities
include financial assistance to upgrade existing units, the construction of new housing, and improvements
to public facilities and infrastructure that service low and moderate income neighborhoods.
The following are some authorized uses of housing set-aside funding:
• Acquisition of real property, buildings, or structures
• New construction or rehabilitation of buildings or structures
• Onsite or offsite improvements, if such improvements are part of a program which results in the
new construction or rehabilitation of affordable housing
• Donation of real property to private or public persons or entities
• Subsidies to, or for the benefit of, lower-income households to obtain housing at affordable costs
in the private marketplace
• Development of plans and payment of principal, interest, financing, or carrying costs on bonds,
loans, advances, or other indebtedness to finance low- and moderate-income housing
• Reasonable administrative expenses (including operating support for nonprofit developers of
redevelopment agency-assisted housing)
In addition to the 20 percent requirement, California Community Redevelopment Law (CRL) contains
inclusionary housing requirements for the Affordable Housing program:
May 12, 2011 PROPOSED
F – 18
LOS GATOS REDEVELOPMENT AGENCY
Affordable Housing Fund
• For units developed by an agency - At least 30 percent of all new or rehabilitated dwelling units
developed by the agency must be available at affordable housing cost to persons of low and
moderate income. Also, not less than 50 percent of those units are to be available at affordable cost
to persons of very low income.
• For units developed within a redevelopment project area - For new or rehabilitated dwelling units
developed by public or private entities or persons other than an agency within a 10-year period, those
units are to be available at costs affordable to persons of low or moderate income. Not less than 40
percent of these units are to be available to very low-income households.
A redevelopment agency may satisfy inclusionary requirements by purchasing or assisting in the purchase
of existing housing, and deed restricting the units for long-term affordability. A redevelopment agency
has this option if the units to be acquired are not presently available at affordable housing cost, or are
presently available at affordable housing cost, but finds the affordability of such units in jeopardy.
Whenever low or moderate income level residential housing units are removed from the market as part of
a specific project, an agency is required by law to rehabilitate or construct an equal number of
replacement dwelling units within the jurisdiction of that agency, within four years of removal. Also, 75
percent of the replacement units must be affordable to the same income level (very low, low, or moderate)
as the persons displaced from the removed units.
BUDGET OVERVIEW
The FY 2011/12 Agency budget includes an Administrative Services payment to the Town in
consideration of Town staff time and resources utilized in supporting affordable housing projects during
this fiscal year and an increase in land acquisition and construction of the Dittos Lane project.
May 12, 2011 PROPOSED
F - 19
LOS GATOS REDEVELOPMENT AGENCY
Affordable Housing Fund
2007/082008/092009/102010/112010/112011/12
ActualsActualsActualsAdoptedEstimatedAdopted
SOURCE OF FUNDS
Beginning Fund Balance
Designated655,697 - - - - -
Undesignated5,901,281 7,198,500 8,631,125 5,140,055 5,140,055 -
Total Beginning Fund Balance
6,556,978 7,198,500 8,631,125 5,140,055 5,140,055 -
Revenues
Interest Income312,963 276,320 50,647 125,000 85,000 25,000
Rental Income- - 16,044 - - -
Total Revenues
312,963 276,320 66,691 125,000 85,000 25,000
Operating Transfers
Tax Increment @ 20%1,614,435 1,714,850 1,804,573 1,605,890 1,605,890 1,641,032
Total Operating Transfers
1,614,435 1,714,850 1,804,573 1,605,890 1,605,890 1,641,032
TOTAL SOURCE OF FUNDS8,484,376$ 9,189,670$ 10,502,389$ 6,870,945$ 6,830,945$ 1,666,032$
USE OF FUNDS
Expenditures
Salaries and Benefits84,614 68,163 129,052 67,510 150,809 70,780
Operating Supplies264,366 262,443 452,574 306,930 6,199,843 331,192
Grants932,700 90,000 412,000 150,000 150,000
-
Capital Expenses- 135,000 4,362,486 3,000,000 322,673 1,000
Internal Service Charges4,196 2,939 6,222 3,108 7,620 3,119
Total Expenditures
1,285,876 558,545 5,362,334 3,527,548 6,830,945 406,091
Operating Transfers
Transfer to Debt Service- - - - - -
Total Operating Transfers
- - - - - -
Ending Fund Balance
Designated- - - - - -
Undesignated7,198,500 8,631,125 5,140,055 3,343,397 - 1,259,941
Total Ending Fund Balance
7,198,500 8,631,125 5,140,055 3,343,397 - 1,259,941
TOTAL USE OF FUNDS8,484,376$ 9,189,670$ 10,502,389$ 6,870,945$ 6,830,945$ 1,666,032$
STATEMENT OF SOURCE AND USE OF FUNDS
May 12, 2011 PROPOSED
F – 20
LOS GATOS REDEVELOPMENT AGENCY
Affordable Housing Fund
FY 2011/12 KEY PROJECTS
KEY PROGRAM SERVICES
Affordable Housing Set-Aside Projects
• Provide planning, analysis and recommendations for potential affordable housing projects
• Initiate an affordable housing project within the Redevelopment Project Area
Core Values Key Projects
Quality Public
Infrastructure
Maintain the
condition and
availability of
public facilities,
transportation
systems, and other
public
infrastructure
Affordable Housing Opportunities
The Agency continues its work in identifying and facilitating other opportunities
for the development of affordable housing.
224 West Main Street
On July 17, 2009, the Los Gatos Redevelopment Agency purchased a 11,326 sf
parcel at 224 W. Main Street. The parcel is located within the Central Los Gatos
Redevelopment Project Area and in the core of the Town's Central Business
District. The property is located adjacent to an existing parking lot that is owned
by the Town. The Town/Agency’s long-term plan is to pursue the site as a mixed
use development, including low and moderate income housing. During the project
development phase, temporary parking opportunities have been constructed on the
site.
20 Dittos Lane
On December 23, 2009, the Los Gatos Redevelopment Agency purchased the 1.28
acre property at 20 Dittos Lane. The Agency is planning for the development of
affordable housing on the property which is located within the Central Los Gatos
Redevelopment Project Area. The property is conveniently situated in downtown
Los Gatos and is within easy walking distance to downtown stores, businesses and
recreation opportunities.
The subject property was in a blighted condition and contained dilapidated
residential buildings some of which were uninhabitable. The buildings were
demolished in August 2010 due to potential life/safety issues. ROEM
Development Corporation has submitted a proposal and development application to
redevelop the property with affordable housing. The redevelopment plan for this
property proposes the construction of a maximum of 32 townhome style apartments
with improved access to Main Street.
May 12, 2011 PROPOSED
F - 21
LOS GATOS REDEVELOPMENT AGENCY
Affordable Housing Fund
Full Time Equivalent (FTE)
Authorized2007/082008/092009/102010/112011/12
Town Staff
PositionsFundedFundedFundedFundedFunded
Community Development Dir.0.10 0.10 0.10 0.10 0.10 0.10
Asst. Community Dev. Dir.- 0.20 0.15 0.15 - -
Planning Manager0.10 0.10 0.10
Economic Vitality Manager0.05 0.05 0.05 0.05 0.05 0.05
Senior Planner0.15 0.15 0.15
Associate Planner- 0.10 0.25 0.10 - -
Community Services Director- 0.05 0.05 0.05 - -
Total Affordable Housing FTEs0.40 0.50 0.60 0.45 0.40 0.40
AFFORDABLE HOUSING PROGRAM STAFFING
Performance Objectives and Measures
2007/08
Actual
2008/09
Actual
2009/10
Actual
2010/11
Estimated
2011/12
Budget
1.
a.Percentage of affordable housing developers that are
satisfied with RDA assistance.
100%100%100%100%100%
Activity and Workload Highlights
2007/08
Actual
2008/09
Actual
2009/10
Actual
2010/11
Estimated
2011/12
Budget
1.5200310Number of new affordable housing units produced, under
construction, or in the planning process as a result of
RDA.
Works in coordination with developers in the planning
and programming of affordable housing projects.
May 12, 2011 PROPOSED
F – 22